Escala Group : Coin Collecting News

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Escala Group is a consolidated global collectibles network. The Company is a leading auctioneer of stamps, coins, arms, armor and militaria, and other memorabilia, targeting both collectors and dealers. Escala is also a merchant/dealer of certain collectibles and trader of precious metals. The Company's collectibles offerings span the modest to ultra high-end price spectrum. Escala conducts its operations in two business segments: collectibles and trading. Escala's Group Companies focused on philately are H.R. Harmer Nutmeg of North America; Corinphila Auktionen of Zurich, Switzerland and the Kohler auction house in Wiesbaden, Germany, in our European division; and John Bull Stamp Auctions, Ltd, the oldest philatelic auction house in Hong Kong, comprising our Asia division. Escala's Group Companies in the numismatics division include Teletrade, Bowers and Merena Auctions, North American Certified Trading, and Spectrum Numismatics International, one of the largest wholesalers of rare coins in the U.S. Greg Martin Auctions is in the Company's art and antiques division. The trading activities of Escala Group are conducted through A-Mark Precious Metals, one of the largest private sellers of bullion coins and bullion gold, silver and platinum to the wholesale marketplace.

Escala to Settle Litigation and Asserts Claims against Former President and CEO Manning

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By Escala Group on Saturday, May 31, 2008
Filed Under: Coins and the Law, Dealer News

Former Escala Group CEO Greg Manning Escala Group (ESCL.PK), a global collectibles company in stamps, coins, precious metals trading, and art and antiques, today announced that it has entered into agreements to settle the securities class action lawsuit and shareholder derivative action commenced against the Company and certain of its current and former officers and directors in May 2006.

As part of the settlement of the derivative action, the Company will recover $5.50 million from insurers on behalf of certain of the named defendants on both proceedings. The Company has also agreed to adopt certain corporate governance policies and procedures, and to pay all court-approved attorneys’ fees, up to a maximum of $925,000, together with approved expenses not to exceed $70,000. The Company’s insurer will fund $475,000 of these amounts.

The proposed settlement of the class action litigation provides for the Company to contribute an aggregate of $6 million in cash and 4 million newly issued shares of its stock (subject to increase under certain circumstances) to a settlement fund for the benefit of the class. A substantial portion of the cash contribution will be funded by insurers. If approved by the Court, all claims against the Company and its current and former officers and directors will be dismissed with prejudice and without any admission of liability or wrongdoing.

The Company’s net cash payment obligations under the proposed settlements, after taking into account recoveries, is approximately $1 million.

The agreements are subject to certain conditions, including approval by the court and by the trustees of Afinsa Bienes Tangibles, S.A. and its subsidiary Auctentia, S.A., the Company’s majority shareholders. Both companies, which are named defendants in the litigation, are in bankruptcy proceedings in the U.S. and Spain. The Company understands that the trustees are seeking approval of the settlement under applicable bankruptcy laws.

Antonio Arenas, Executive Chairman, said, “We are pleased to have reached a mutually satisfactory settlement in principle with the plaintiffs and we are hopeful that the settlements will be finalized shortly. “ (more…)